From time to time, institutions will find themselves in a dispute with a donor, a donor’s descendants (in jurisdictions that allow standing for such actions), and or state attorneys general or other regulators, over the appropriate use of a prior gift.  A recent case involving The Johns Hopkins University is the latest to illustrate the importance of the language used in any gift, or other contractual, instrument. In the late 1980’s, the University was the beneficiary of the purchase of an undeveloped piece of property for a price that was about one-third of the fair market value of the parcel.  The seller was a well recognized critic of development in Montgomery County, Maryland.  She sold the property at a reduced price to the University (recognizing the excess value of the transaction as a charitable contribution) rather than succumb to numerous offers for the property’s commercial development, and with the apparent expectation for the University to develop it as a pastoral-like University campus.  Accordingly, the contract and deed restricted the University’s use of the parcel to “agricultural, academic, research and development, delivery of health and medical care and services, or related purposes only, which uses may specifically include but not be limited to development of a research campus in affiliation with one or more divisions” of the University.  After plans were approved to allow for rezoning of the parcel to permit much higher density use of the property than, according to the donor’s surviving family, the donor would ever have considered acceptable, the family commenced litigation to prevent the University from moving forward. Ultimately the Maryland Court of Appeals determined that the restrictions in the deed and contract were “unambiguous” and allowed the development the University sought.  The Court found that there was no dispute that the University’s plan sought only to pursue “agricultural, academic, research and development, delivery of health and medical care and services, or related purposes” as specified in the restriction.  The dispute was whether the contract and deed restricted the scale and density of that development and whether they required “Hopkins qua Hopkins to own and operate the buildings and programs” on the property. While the Court noted that the donor’s family was “no doubt … genuinely aggrieved” by the University’s plans to deviate from the donor’s thoughts regarding the future use of the property, the Court noted that its “task is to examine the agreement the parties did sign, not the agreement that one or the other now wishes they had negotiated instead.”  Relying on basic contract construction principles, the Court rejected the family’s contention that the restriction on “its [the University’s] use” of the property to the specified purposes meant that only the University could own or occupy that property and that it prohibited leasing any portion of the property to third parties:  “We cannot see why Hopkins leasing the property to others to accomplish one or more of the listed purposes does not qualify as a use by Hopkins….Here, the [property] will be used for an indisputably approved purpose, and nothing in [the deed or contract] restricts how or through whom the Buyer, Hopkins, can carry out those purposes.”  The Court also rejected the family’s argument that the mere reference to a “campus” use imposed scale and density restrictions on the University’s development of the parcel. Ultimately the Court found that the unambiguous language of the deed and contract did not preclude the University from moving forward with its plans, notwithstanding the seller’s intent.  Had the language been less clear, the result could have been different, in that the seller’s intent might have functioned to further restrict the University in its actions.  This possibility highlights the importance of careful drafting in gift instruments.  While institutions may be understandably reluctant to test donors’ patience by negotiating extensively over language in a gift instrument, they should always keep in mind that needs and resources change over time.  Restrictions, especially on real property, which an institution may see as workable at the time a gift is made, may prove far less workable when it comes time to actually make use of the gift.  As a result it is important to make sure that gift instruments provide sufficient flexibility to the institution to allow it to deal with the gift in an appropriate manner, and/or to modify the permitted use as desired, as circumstances change several decades or more into the future.  Clarity in this regard may not only help prevent years of costly litigation and/or regulatory scrutiny, but it can also help to avoid public disputes that can negatively impact its relationship with future donors.

On October 28, New York State released information necessary for private colleges and universities to begin applying to participate in the Start-Up NY Program.  As you may recall, the Start-Up NY Program was enacted during the Summer of 2013, and provides very substantial benefits to certain businesses that open within designated areas proximate to qualifying higher educational institutions. The amount of space available for private institutions to participate in the Program is limited. Given the limit on available space, any delay in submission of the requisite application materials may cause an institution to be left out of the Program.  As a result, now that the State has clarified the application process for private colleges and universities, institutions interested in participating in the Start-Up NY Program should act immediately to submit their application materials.

On July 25, 2013, Governor Andrew Cuomo signed into law the Kerry Rose Fire Sprinkler Notification Act, which requires the immediate disclosure of residential fire safety system information by colleges and universities in New York State. The Act is named for Kerry Rose Fitzsimons, a college student who died, along with two others, in a 2012 fire in her off-campus residence.

The Act adds a new Section 6438 to the New York Education Law, requiring institutions to disclose in writing to students residing in an institutionally-owned or operated housing facility a description of the facility’s fire safety system, including whether the facility is (or is not) equipped with a sprinkler system. The written notification must also indicate how students may access the institution’s Campus Fire Safety Report published pursuant to the federal Higher Education Opportunity Act.

The Act is effective immediately. Accordingly, colleges and universities in New York should take steps to inform all current and future residential students of the information described above, taking care to ensure that the disclosed information provides an accurate description of their fire safety capabilities. The Act does not specify the precise timing or means by which notice must be provided, other than to require that the notice be in writing. We anticipate that in the future, most institutions will choose to provide this information as part of the documentation by which students elect to reside in their residential facilities; however, an ad hoc notification process may be necessary for those students who have already completed the housing registration procedure for the 2013-2014 academic year.

"Happy Birthday to You" is one of the most widely recognized songs in the world.  Did you also know that the song brings in about $2 million per year to the copyright holders?  Ever wondered why they sing something other than "Happy Birthday to You" at your favorite restaurant? All your questions about this ubiquitous song are answered below (including questions you didn't know you had!).  Here's your "5 Question Guide" to "Happy Birthday to You":   1. You mean "Happy Birthday to You" isn't in the public domain? No, the song is still under copyright protection in at least the United States and Europe, and continues to bring in substantial licensing fees every year.   2. So what does that mean? Do I owe someone money for singing on Grandma’s birthday? Probably not.  The U.S. Copyright Act grants certain rights to copyright holders, one of which is the right to control when the work is performed “publicly.” A performance is considered “public” when the work is performed in a “place open to the public or at a place where a substantial number of persons outside of a normal circle of a family and its social acquaintances are gathered.” A performance is also considered to be public if it is transmitted to multiple locations, such as through television and radio. So, unless you sang Happy Birthday in a public place for others to hear, or broadcast it to the public, you don’t need to write a check.  Singing Happy Birthday with friends and family in your home is just fine. Notably, this is the reason that most restaurants have their own lyrics and music to perform for a customer’s birthday; singing Happy Birthday to You would constitute a public performance.   3. Who wrote "Happy Birthday to You"? Most agree that the song is a variation of “Good Morning to All,” a children’s song written and composed in 1893 by sisters Patty and Mildred J. Hill of Louisville, Kentucky.  Exactly who modified the original song is unclear.   4. Who owns the rights to "Happy Birthday to You"? The rights are currently owned by Warner/Chappell Music, Inc.  According to some reports, the company brings in as much as $2 million a year from licensing the song for public performances in movies, television, radio, as well as live performances.   5.  So when can I sing “Happy Birthday” in public? The song will not officially enter the public domain in the United States until 2030, or 95 years after publication (a term that has been extended several times by the Copyright Act of 1976 and the Copyright Term Extension Act of 1998).  The song will enter the public domain in Europe in 2016, or 70 years after the death of Patty Hill (who died May 25, 1946). However, some believe that Happy Birthday may already be well within the public domain in the U.S.  For an extensive and thorough analysis of the history and copyright status of “Happy Birthday,” see the research paper by Robert Brauneis at SSRN (“Copyright and the World's Most Popular Song”).  

The Obama administration has taken a step towards its goal of ensuring public access to federally funded research.  In a policy memorandum released on February 22, 2013 (see "Increasing Access to the Results of Federally Funded Scientific Research"), the Office of Science and Technology Policy  has directed Federal agencies with more than $100M in R&D expenditures to develop plans to make the published results of federally funded research freely available to the public within one year of publication and requiring researchers to better account for and manage the digital data resulting from federally funded scientific research.  The memorandum is in part a response to a We the People petition signed by over 65,000 people requesting better access to taxpayer-funded research. The policy memorandum states that digitally formatted scientific data resulting from unclassified research supported wholly or in part by Federal funding should be stored and publicly accessible to search, retrieve, and analyze. For purposes of the memorandum, data is defined, consistent with OMB circular A-110, as the digital recorded factual material commonly accepted in the scientific community as necessary to validate research findings including data sets used to support scholarly publications, but does not include laboratory notebooks, preliminary analyses, drafts of scientific papers, plans for future research, peer review reports, communications with colleagues, or physical objects, such as laboratory specimens. Six-month Deadline to Provide a Plan Within 6 months from the issuance of the policy, each affected federal agency must provide a plan that provides for the following:

• a strategy for leveraging existing archives, where appropriate, and fostering public/private partnerships with scientific journals relevant to the agency’s research;

• a strategy for improving the public’s ability to locate and access digital data resulting from federally funded scientific research;

• an approach for optimizing search, archival, and dissemination features that encourages innovation in accessibility and interoperability, while ensuring long-term stewardship of the results of federally funded research;

• a plan for notifying awardees and other federally funded scientific researchers of their obligations (e.g., through guidance, conditions of awards, and/or regulatory changes);

• an agency strategy for measuring and, as necessary, enforcing compliance with its plan;

• identification of resources within the existing agency budget to implement the plan;

• a timeline for implementation; and

• identification of any special circumstances that prevent the agency from meeting any of the objectives set out in this memorandum, in whole or in part.

Further, each agency’s public access plan must, among other things, also:

• ensure that extramural researchers receiving Federal grants and contracts for scientific research and intramural researchers develop data management plans, as appropriate, describing how they will provide for long-term preservation of, and access to, scientific data in digital formats resulting from federally funded research, or explaining why long-term preservation and access cannot be justified; and

• allow the inclusion of appropriate costs for data management and access in proposals for Federal funding for scientific research.

Stay Tuned As this public access policy will affect university researchers and contract administrators, becoming and maintaining familiarity with the policy is important.  We will post periodic updates as more information becomes available about the policy and the various agency plans released for implementation of the policy.

At the Chronicle of Higher Education website, Paul Basken reports that new rules will be published in the Federal Register concerning corporate ties of researchers and required disclosures relating thereto. In a nutshell:

The final form of the changes falls short of some of the more aggressive regulations suggested by Dr. Collins and the NIH. In particular, the rules do not require universities to post online details of the specific financial conflicts involving their scientists. Instead, universities are required only to respond to individual requests for such information. And, despite the fact that the rule-making process was halted a year ago following revelations that a prominent psychiatrist had escaped NIH sanctions by moving to a new university, the final language does nothing new to specifically prevent such a maneuver. 

On July 29, 2011, a Federal Circuit panel decided Association For Molecular Pathology v. Myriad Genetics (Fed. Cir. 2011). This is an important case for patent law, as it relates to genetics. The short version is that: (i) isolated DNA is eligible for patent protection; (ii) claims directed to working with the isolated DNA, in non-specific ways, are not eligible for patent; and (iii) a claim directed to a specific method of using the isolated DNA for cancer screening is eligible for patent. It should be kept in mind that “eligible for patent” is not the same as “patentable,” and the isolated DNA and cancer screening method must still be sufficiently new and creative to sustain a valid. This decision is reported more fully in a Bond, Schoeneck & King Information Memo. One interesting aspect is that people who work for universities appear on both sides. This is a nice thing about patent law, generally, and it is something that carries over into the slice of patent law dominated by research universities – there is not really a “Patent Plaintiff’s Bar” and a “Patent Defendant’s Bar.” Patents are a double edged sword, and a research university could find itself on either side of a given patent, for or against. This really brings some balance, nuance and moderated synthesis to patent law that one doesn’t always find in other areas of the law. The Association For Molecular Pathology case is a good example of this, whether or not one agrees with where exactly the Federal Circuit has drawn the line on the patent-eligibility of DNA and its associated scientific and medical methods.

At Inside Higher Ed, Paula M. Krebs writes:

The institution to which I was attached, the five-campus University of Massachusetts system, understands its role in its state and region in terms inherited from the Morrill Act of 1862, which established the land-grant colleges and their obligation to train state residents in new techniques of agriculture. The current manifestation of the Morrill Act would seem to be in the university’s commitment to commercial ventures, patents, and intellectual property, helping to start and support new businesses that grow out of research done on campus.

Teach a man to fish and you feed him for a lifetime.